Beirut is now more expensive than Abu Dhabi

But Tel Aviv, at place 31, is still the most expensive city in the Middle East for expatriates, with Beirut (67) coming in at a distant second, according to the 2012 Mercer Cost of Living Survey.

The survey looks at 214 cities across five continents and judges over 200 factors in each location, including transport, food, clothing, household goods and entertainment. Housing often accounts for the biggest expense for expatriates and is thus a decisive item behind the results.

In the Middle East, only moderate changes have taken place since last year. Beirut swapped spots with Abu Dhabi as the most expensive Arab city in the region, while Jeddah (186) in Saudi Arabia continues to offer the cheapest cost of living for expats.

“On the whole, most Middle Eastern cities have dropped in the ranking, mainly because price increases on goods and services have been more moderate here than in our benchmark city, New York. Slight decreases in expatriate accommodation costs were also observed in Abu Dhabi and Dubai,” said Nathalie Constantin-Métral, Principal at Mercer.